Analyzing Adobe (NASDAQ:ADBE) and Lightspeed Commerce (NYSE:LSPD)

Lightspeed Commerce (NYSE:LSPD) and Adobe (NASDAQ:ADBE) are both business services companies, but which is the better stock? We will compare the two companies based on the strength of their earnings, risk, valuation, profitability, institutional ownership, dividends and analyst recommendations.

Earnings & Valuation

This table compares Lightspeed Commerce and Adobe”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Lightspeed Commerce	$909.27 million	3.14	-$163.96 million	($0.89)	-21.10
Adobe	$20.95 billion	10.79	$5.43 billion	$11.84	43.39

Adobe has higher revenue and earnings than Lightspeed Commerce. Lightspeed Commerce is trading at a lower price-to-earnings ratio than Adobe, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Lightspeed Commerce has a beta of 2.35, indicating that its stock price is 135% more volatile than the S&P 500. Comparatively, Adobe has a beta of 1.3, indicating that its stock price is 30% more volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Lightspeed Commerce and Adobe, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Lightspeed Commerce	0	9	6	1	2.50
Adobe	2	7	17	1	2.63

Lightspeed Commerce currently has a consensus target price of $19.88, suggesting a potential upside of 5.86%. Adobe has a consensus target price of $606.40, suggesting a potential upside of 18.05%. Given Adobe’s stronger consensus rating and higher probable upside, analysts clearly believe Adobe is more favorable than Lightspeed Commerce.

Insider and Institutional Ownership

68.7% of Lightspeed Commerce shares are owned by institutional investors. Comparatively, 81.8% of Adobe shares are owned by institutional investors. 0.2% of Adobe shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Profitability

This table compares Lightspeed Commerce and Adobe’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Lightspeed Commerce	-13.56%	-0.10%	-0.10%
Adobe	25.59%	42.82%	22.20%

Summary

Adobe beats Lightspeed Commerce on 13 of the 14 factors compared between the two stocks.

About Lightspeed Commerce

Lightspeed Commerce Inc. engages in sale of cloud-based software subscriptions and payments solutions for small and midsize businesses, retailers, restaurants, and golf course operators in North America, Europe, the United Kingdom, Australia, New Zealand, and internationally. Its Software as a Service platform enables customers to engage with consumers, manage operations, accept payments, etc. The company's cloud platforms are designed interrelated elements, such as omni-channel consumer experience, a comprehensive back-office operations management suite to improve customers' efficiency and insight, and the facilitation of payments. Its platform functionalities include full omni-channel capabilities, point of sale (POS), product and menu management, employee and inventory management, analytics and reporting, multi-location connectivity, order-ahead and curbside pickup functionality, loyalty, and customer management solutions. The company also offers tailored financial solutions, such as Lightspeed Retail, Lightspeed eCommerce, Lightspeed Restaurant, and Lightspeed B2B solutions. In addition, it sells hardware, including tablets, customer facing displays, receipt printers, networking hardware, cash drawers, payment terminals, servers, stands, bar-code scanners, and an assortment of accessories, as well as provides installation and implementation services. The company was formerly known as Lightspeed POS Inc. and changed its name to Lightspeed Commerce Inc. in August 2021. Lightspeed Commerce Inc. was incorporated in 2005 and is headquartered in Montreal, Canada.

About Adobe

Adobe Inc., together with its subsidiaries, operates as a diversified software company worldwide. It operates through three segments: Digital Media, Digital Experience, and Publishing and Advertising. The Digital Media segment offers products, services, and solutions that enable individuals, teams, and enterprises to create, publish, and promote content; and Document Cloud, a unified cloud-based document services platform. Its flagship product is Creative Cloud, a subscription service that allows members to access its creative products. This segment serves content creators, students, workers, marketers, educators, enthusiasts, and communicators. The Digital Experience segment provides an integrated platform and set of applications and services that enable brands and businesses to create, manage, execute, measure, monetize, and optimize customer experiences from analytics to commerce. This segment serves marketers, advertisers, agencies, publishers, merchandisers, merchants, web analysts, data scientists, developers, and executives across the C-suite. The Publishing and Advertising segment offers products and services, such as e-learning solutions, technical document publishing, web conferencing, document and forms platform, web application development, and high-end printing, as well as Advertising Cloud offerings. It also provides consulting, technical support, and learning services. The company offers its products and services directly to enterprise customers through its sales force and local field offices, as well as to end users through app stores and through its website at adobe.com. It also distributes products and services through distributors, value-added resellers, systems integrators, software vendors and developers, retailers, and original equipment manufacturers. The company was formerly known as Adobe Systems Incorporated and changed its name to Adobe Inc. in October 2018. Adobe Inc. was founded in 1982 and is headquartered in San Jose, California.